With the number of COVID-19 cases still rising nationwide, it is not surprising that, depending upon which poll you look at - and despite the economic pain the health crisis is causing - between 58 percent and 81 percent of Americans support keeping stay-at-home restrictions in place and even expanding them to the nation as a whole.
Yet a few states have never had such restrictions in place, some were later than others to be deemed an essential business, and a few are lifting or loosening restrictions, leaving wary consumers in the driver’s seat.
It is also not surprising, then, that the impact of the pandemic on the real estate market is widely different depending on where you look.
“We had a strong April,” said Dan Forsman, president and CEO, Berkshire Hathaway HomeServices Georgia Properties in Atlanta, where stay-at home orders were largely lifted by the third week of April. “That was based in part by the number of transaction closings generated earlier and in part because we lowered our overhead early on in anticipation of what might happen next.”
While he freely admits he has no crystal ball, Forsman is looking for a mid-spring uptick.
“Buyers are ready and inventory is limited,” he said. “While we can’t measure what the response will be, our virtual showings have been way up, and we’re having our first virtual mega-open house this weekend.”
Despite some concern that high unemployment means fewer buyers will qualify for a mortgage loan, Forsman anticipates pending sales in May will be down no more than 35 percent.
That’s in stark contrast to states like Nevada and Ohio, where stay-at-home orders remain in place through the end of May.
“Business in April was down 40 percent overall,” said Ryan Elliott, senior vice president, Assist-2-Sell Real Estate in Reno.
But there is business to be done.
“We listed and sold four homes this week,” Elliott said, “with sellers seeing multiple offers from buyers who are ready to purchase”.
Like Forsman, Elliott expressed some concern about tightened mortgage eligibility.
“Agents need to be more focused than ever on having buyers carefully vetted,” he said, “but we are cautiously optimistic going forward. We know we won’t ramp up overnight, but we do expect that pent-up demand on the part of both buyers and sellers will help us spring back over the next three to six months.”
Heavy tolls are experienced in central and southern states, such as Ohio, where stay-at-home orders remain in place through May 29, and in Indiana and Kentucky, where restrictions remained in place through the end of April.
“Pending sales in April dipped,” said Brad DeVries, president and CEO, HomeServices of America, who oversees Berkshire Hathaway affiliates in all three states. “We were down 25 percent in Ohio, 30 percent in Lexington, Kentucky, and 35 percent in Louisville - all areas where sellers remain reluctant, and buyers are still cautious.”
The firms he leads are pressing the pause button, he said, feeling out the job market and analyzing where the state of the industry is going.
“Demand will surge,” he said. “We are confident of that, and we know that what we do today will affect how we do in the coming months. We tell our people, ‘don’t be secret agents. Reach out to your database. Keep people advised and updated, and they will reach out to you when they are ready.’”
Results in other areas are mixed.
In Utah, where no stay-at-home orders were ever in place, business nonetheless declined.
“April saw a decline overall of 50 percent in closed transactions,” said Jonathan Hayward, managing broker, Coldwell Banker Residential Brokerage in St. Louis. “But we have snapped back 20 percent in new contracts opened this month, largely because buyers are ready to buy and listings are in short supply. One $800,000 home listed just the other day has already drawn 11 offers.”
Yet in Nebraska, another state with no stay-at-home restrictions, March and April business fell by less than 20 percent from 2019 for at least one major company.
“For one thing, we were already doing a lot of things digitally” said Andy Alloway, president and CEO, Nebraska Realty, the state’s largest independently owned realty firm. “Apart from adding curbside closings, we were well prepared to meet the needs of safety-conscious but ready buyers.”
As in most states, Alloway is dealing with strains on inventory aggravated by the coronavirus crisis. “Demand is high,” he said, “and multiple offers are the norm.”
Health and safety precautions will remain a priority for a very long time, he said. “But it’s time to start cautiously coming out of the decline, one step at a time.”
While safety for agents and consumers alike remains job one for the brokers we polled, job two, they agreed, is encouraging agents to use their downtime to learn something new, organize their CRM, stay in close touch with their SOI, and be well prepared as business increases.
“Our motto is, ‘forever forward,’” said Forsman, and that’s what we tell our agents. “Don’t go through this crisis of a lifetime and not come out stronger on the other side of it.”
